How much funding can I apply to the SME Equity Fund for?
SEF can invest a minimum of Rs 500,000 and a maximum of Rs 25m in a project. The amount invested by SEF can represent a maximum of 49% of the total share capital of the company. The promoter will therefore have to invest a minimum of 51%. SEF cannot invest more than what the promoter has invested or would invest.
I have already invested in equipment and other materials for my business. Will that count as my contribution?
Yes, these can be counted as your contribution to the company if funding was through own capital. These assets will have to be transferred on the name of the company, if they are registered on your personal name. The value of assets will have to be certified by an independent valuer.
Who can benefit from SME Equity Fund investment?
All companies in any business sector can benefit from SME Equity Fund financing, excluding gambling, real estate projects, financing of solely working capital (stock, salaries, operational expenses) and pure trading activities.
I have acquired an existing business and effected payment in cash on different occasions. This was settled between the owner and myself and we have no evidence other than an agreement signed by us. Can we make an application to SME Equity Fund Ltd for funding?
No, SEF is bound by the Financial Intelligence and Money Laundering Act 2002.
I have invested above Rs 500,000 in my business and this was financed by a company loan. Can I apply for additional funds from SME Equity Fund?
Consideration will be given only if your equity contribution exceeds Rs550,000 (51% of total Equity), and this is reflected in your audited accounts.
I have taken a personal loan on personal assets to finance my business. Can this be considered as my investment/contribution to my business?
A personal loan taken is not considered as contribution.
I need funds to start my business but do not have any assets. Can I give my house as guarantee?
No, a matrimonial property is subject to terms of Borrowers Protection Act.
I want to start a business now but have not yet obtained all operational permits. Can I still make an application for funding at SEF?
Your application can be made, which shall be processed in the meantime. The operational permits should, however, be submitted prior to disbursement of funds.
What happens if I am unable to buy back the shares during the investment period?
SEF may with your consent transfer its shares to another party or initiate any other actions as per the Investment Agreement.
Why do I need to sign the mandate to share information?
This document allows SEF to liaise with your banker in the course of its due diligence process. It is mandatory for all potential clients to sign this form.